Detroit Market Recap
Total Page:16
File Type:pdf, Size:1020Kb
APRIL 2016 DETROIT MARKET RECAP THIS DETROIT MARKET RECAP IS PROVIDED TO YOU COURTESY OF YOUR LOCAL BUSINESS PARTNER AT MARKET RECAP: April 2016 TRENDS April U.S. April MI UNEMPLOYMENT UNEMPLOYMENT 7,920,000 232,000 In April, Michigan unemployment remained steady at 4.8%. 7% vs YOY 12% vs YOY In April, the US unemployment was unchanged from last month, at 5.0%. Employment increased in real estate, education, manufacturing and health care. Job losses occurred U.S. & MI UNEMPLOYMENT in construction and retail trade. EMPLOYMENT There is concern regarding serious mismatches between jobs 5.0 growing in the state and careers that interest kids. Just as there is a talent gap in Michigan’s adult labor force, there are 4.8 mismatches between internships employers are offering and actual jobs. To address the issue, Detroit Employment Solutions Corp. is helping Grow Detroit’s Young Talent effort, which has a goal of 8,000 internships. J15 J15 J16 S15 F16 A15 A15 A16 D15 N15 O15 M15 M16 US MI April U.S. April MI Total home and condominium sales in Wayne, Oakland, FORECLOSURES FORECLOSURES Macomb and Livingston counties climbed 7.1 percent year- over-year in March while the median sale prices rose 5.7 1 in 1,308 HOMES 1 in 1,620 HOMES percent. A drop in inventory is raising home prices across Metro Detroit. The disparity between supply and demand is particularly March US & MI MEDIAN HOME pronounced for homes selling for less than $250,000, mainly starter homes for Millennials and Gen Xers. Meanwhile the PRICE ($000)* booming market has led to an influx of real estate agents – REAL ESTATE Re/Max increased its number of agents 11% from 2014 to 2015 and opened 7 new offices. $151 $181 $195 $204 $199 $225 $129 $125 $125 $131 $125 $143 Southeast Michigan's mortgage industry has been improving, grabbing market share from big out-of-state lenders who pulled back as some local companies stepped up. One of the latest newcomers to the business is Lenderful, a Karmanos owned company based in Birmingham. It markets itself as an O15 N15 D15 J16 F16 M16 all-online mortgage platform. US MI U.S. # OF CARS # OF CARS SOLD SOLD BY MAKER In April there were over 1.5M new car sales (+3.5% YOY) in 1,506,431 the U.S. 3.5% vs YOY FIAT-CHRYSLER Ford Motor Co. is expected to build a Ranger mid-size pickup 199,631 at Michigan Assembly beginning in 2018, and could also % MARKET revive the Bronco SUV there. The move is part of a AUTOMOTIVE SHARE production strategy by Ford that will focus its manufacturing FORD on larger, more-profitable vehicles such as SUVs and pickup 13.4 trucks in the U.S. 229,739 15.6 Fiat Chrysler is still keen on merging with another large 54.1 automaker, including Korean automakers. GM 16.9 259,557 Sources:* Median Detroit home Freeprice Press, data isThe one Detroit month News, behind Bureau of Labor Statistics, Good Car Bad Car *ThereSources: is Detroita one month Free Press, delay Thein reporting Detroit News,for median Mlive, home Crains, price. GoodCarBadCar, RealtyTrac, Michigan Dept. of Technology, Management & Budget MARKET RECAP: April 2016 HIGHLIGHTS Real estate investors have spent more than $1 billion acquiring properties near the QLine rail route, in hopes the project will be extended northward. The rail is scheduled to be complete in the first quarter of 2017. A $22 million redevelopment of the former "Hammer and Nail" building in Midtown calls for 72 apartments and 2,000 square feet of first-floor retail space to be completed by the end of 2017. Greater downtown Detroit residential real estate is now soaring with a few property owners even listing their DETROIT downtown and Midtown properties for prices running into the millions of dollars. In the Midtown district north of REVITALIZATION downtown, median home sale prices so far this year have hit $293,000, almost double the median price in Spring 2013. These price spikes apply only in the greater downtown area and in a few of Detroit's historic districts such as Sherwood Forest and Palmer Woods. Two trends have united to produce the sharply rising prices: demand for urban living and a lack of for-sale product. The millennials are going mostly for the many new apartment units coming onto the market all over the greater downtown area, but empty-nest baby boomers turn out to be the prime market for condominium purchases in places like Brush Park and for houses in historic districts such as Palmer Woods. A national retail chain appears to be building out space in the former Kmart location on North Maple Road. City DEPARTMENT records show that a 22,250-square-foot portion of the building is being renovated for a Sierra Trading Post, a clothing, home décor and outdoors retailer. STORES Sierra Trading Post will join Stein Mart and HomeGoods as tenants in the building. In April, Detroit casinos' aggregate revenue for MGM, MotorCIty and Greektown was $122 million (up 1.5% year- over-year). ENTERTAINMENT National parks injected close to $290 million into Michigan's economy last year. An estimated 2.4 million recreational visitors spent time at the 5 parks. Travelers and locals spent $204.4 million in the areas around the parks, money that resulted in 3,300 full-time, part-time and temporary jobs in the state. There are now 36 venture capital firms either headquartered or with an office in Michigan. These firms have more money under management than ever before — $2.2 billion, nearly double the amount five years ago. There are FINANCIAL 141 venture-backed companies operating in Michigan, nearly double the number five years ago. Every $1 invested in a Michigan start-up by a Michigan venture capital firm attracts $4.31 of investment from outside the state. Metro Detroit is a growing destination for national food franchises. Dunkin' Brands says it plans to add at least 20 new stores over the next five years in metro Detroit, and Tropical Smoothie Café will open another 20 locations this RESTAURANT year, too. Those announcements follow news that Chick-fil-A, which opened its first free-standing Michigan location in Lansing, will add 20 more locations in the state over the next five years. The overall climate for franchises in Detroit and Michigan appears to be strong. Kroger has announced a $180-million investment in Michigan, while creating 1,000 new jobs as part of a package of new retail locations and rehabs of existing stores. It comes in the form of three new Marketplace stores; six new GROCERY fuel centers; 22 new ClickList sites, which are stores where you can pick up your online order without getting out of your car; and extensive remodeling at 11 existing stores. The trio of new locations will be in Royal Oak, White Lake Township, and Shelby Township. Southeast Michigan health systems posted the highest profit margins in several years for 2015. Five systems in metro Detroit positively rebounded after several years of dampened profitability. These systems include Beaumont Health, Henry Ford Health System, St. John Providence Health System, and McLaren Healthcare Corp. Michigan's 14 Medicaid HMOs, also reported a record average 2015 profit margin. Health Henry Ford Health System and Allegiance Health in Jackson have finalized the merger agreement that that will bring the 475-bed Jackson-based hospital into the system as Henry Ford Allegiance Health. Adding Allegiance will create a six-hospital Henry Ford system with $5.2 billion revenue, the largest by revenue in Southeast Michigan. Henry Ford has agreed to invest $300 million over five years to add new facilities, information technologies and other programs and services. .